"Alfa Ltd. has 10,000 ; 10% Debentures
of Rs 100 each due for redemption at a
premium of 10%. The company had a
credit balance of Rs 12,00,000 in its surplus ( Balance of statement of P&L). Company decided to redeem the debentures out of it. The amount transferred to DRR would be --"
Answer & explanation
Correct answer: option 1
If redemption is out of profit , amount transfer to DRR should be equal to 100% of the nominal value of Outstanding Redeemable Debentures.
10,000 x 100 = ₹10,00000
10,000 x 100 = ₹10,00000